Why Iran’s Elections Are So Important

Iranians head to the polls to elect a new president this Friday, at a time when tightening sanctions are crippling the economy, driving up unemployment and inflating the prices of basic goods.

Far from merely an internal affair, the international community, from diplomats to investors, are on the sidelines, scrambling to decipher the complexities of the country's political process.

"If anything, Iranian elections have always surprised observers because of their unpredictability," Arshin Adib-Moghaddam, chair of the Centre for Iranian Studies at London's School of Oriental and African Studies (SOAS), told CNBC.

In 2009, elections ended in violent clashes between reformists, disputing the victory of Mahmoud Ahmedinejad, and government forces. Analysts told CNBC that this time around, the government has taken additional measures to avoid a replay of the scenes that drew criticism from around the world.

For the six candidates on the ballot in Iran's eleventh presidential election, the country's teetering economy has been at the forefront of speeches and debates on the campaign trail. Other topics, such as the nation's controversial nuclear program, are still discussed but are of less immediate concern for most Iranians.

All of those running were vetted by the Guardian Council, a body loyal to the Supreme Leader of the Islamic Republic, Ayatollah Ali Khamenei.

Hassan Rouhani, a former nuclear negotiator, is a cleric and a member of the Supreme National Security Council. His presidential campaign presents him as more of reformist than his past may suggest.

But in a blog post, Suzanne Maloney, senior fellow at the Saban Center for Middle East Policy, was quick to dampen expectations. She described Rouhani as "an absolute creature of the system, someone whose support for the theocratic system has never wavered."

Mohammad Baqer Qalibaf has been the mayor of Tehran since 2005 and previously served as a commander of the Revolutionary Guard. Adib-Moghaddam, who is also the author of "Iran in World Politics: The Questions of the Islamic Republic," added: "I wouldn't discount the penchant for change that Qalibaf may bring given that he has political clout with the Revolutionary Guards and the pragmatic factions of the conservatives."

Saeed Jalili is the youngest protagonist in the line-up and Iran's chief nuclear negotiator. He has been described as a conservative and, as a protégé of Khamenei, is definitely a challenger of interest.

Ali Akbar Velayati is a foreign policy advisor to the Supreme Leader and has also severed as the country's foreign minister. On a personal, yet relevant, note, his daughter is married to the son of Khamenei.

The remaining two candidates are Mohsen Rezaei, currently the secretary of Iran's Expediency Council, and Mohammad Gharazi, who previously led the Ministry of Petroleum.

If no one secures more than 50 percent of the vote, the election goes into a second round between the top two contenders a week later on June 21. Most analysts see this scenario as probable.

Official statistics show that annual inflation was 31.5 percent in March, although others believe the figure to be far higher. Hard currency is equally hard to come by, and the International Energy Agency (IEA) said the country lost $40 billion worth of exports in 2012 due to sanctions.

Often, changes in government do not translate into drastic alterations in basic policy. This concern is more pronounced in Iran, given that the final say rests not with the President, but the Supreme Leader. Still, hopes are high that the recurring caustic, market-rattling pronouncements of earlier years have come to an end.

"It is highly likely that we will see a decisive shift away from the foreign policy rhetoric of the Ahmadinejad years," Adib-Moghaddam added. "The new President is likely to pursue a rather more diplomatic path. In particular, I expect a more nuanced approach to the European Union."